Kroon Electric Corp. announced last week it has received a “significant growth capital investment” from BDC Capital, the investment arm of the Business Development Bank of Canada, and a group of investors led by U.S.-based serial entrepreneur George Fechter.
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An Ottawa-based electrical services company has raised more than US$50 million to fuel its push to create a billion-dollar global consulting and engineering consortium.
Kroon Electric Corp. announced last week it has received a “significant growth capital investment” from BDC Capital, the investment arm of the Business Development Bank of Canada, and a group of investors led by U.S.-based serial entrepreneur George Fechter.
Founded by Cornelius Kroon in 1976, Kroon Electric is now owned and operated by Kroon’s children, Michael and Audrey. Originally a construction company that built houses and small commercial projects, the firm has evolved into a services and engineering firm with 100 employees and offices in Ottawa, Kingston and Montreal.
Kroon Electric maintains, refurbishes and replaces electrical assets such as high-voltage transformers, substations and systems that provide uninterrupted power to buildings when main electricity sources fail.
Michael Kroon says the firm’s revenues have tripled in the past six years as the push to make office and industrial buildings more energy-efficient means infrastructure such as boilers that previously ran on natural gas or other fossil fuels is increasingly powered by electricity.
“Part of the challenge that many buildings face is that their aging electrical distribution (infrastructure) cannot support the transition to decarbonization,” says Kroon, who has been president of Kroon Electric since 2001.
The family-owned firm now has contracts with “almost all of the largest buildings in Ottawa,” Kroon says, including several local hospitals.
Kroon Electric’s engineers, technicians and electricians are constantly testing breakers, transformers and other key electrical equipment at those sites. Meanwhile, they are also sought-after for their expertise in areas such as whether a building’s electrical infrastructure is robust enough to support EV charging stations, solar panels and other emerging green-energy technology.
It’s a highly specialized industry, Kroon notes, and one that’s seeing an “exponential” rise in demand for its services.
“Ottawa doesn't know us very well, but people in our industry know us very, very well,” he adds.
As Kroon Electric’s sales ballooned, so did its attractiveness as a potential acquisition target.
In the past few years, Kroon says, he’s received “weekly” calls from U.S. organizations that were angling to make an offer for his firm.
“It would have been very easy for us to just sell and have some management team come and take over,” he admits.
Instead, Kroon and his sister, Audrey Lowther, decided to flip the script.
Last fall, they met with BDC Capital to discuss their grand plan to start acquiring other firms in the electrical services space with the goal of creating a “billion-dollar company.”
